A baby has died and 14 others are fighting for their lives after being poisoned by contaminated drips.
Health chiefs have launched an urgent investigation after the vulnerable babies, who were all in intensive care, developed septicaemia after being infected by a bug in their liquid food.
The babies - most born prematurely - were being fed through a tube into their bloodstream because they were too poorly to be mouth fed.
Public Health England said babies at six hospitals developed septicaemia from the Bacillus cereus bacterium.
The baby who died was at St Thomas' Hospital in south London.
The infected nutrition is believed to have been used in 22 hospitals across the country.
Its manufacturer said it was 'saddened' by what had happened.
ITH Pharma managing director Karen Hamling said it was co-operating fully with an inquiry by health officials.
She said: "ITH Pharma is very saddened to hear about the death of a baby in hospital, and that 14 others are ill with septicaemia.
"ITH Pharma is a specialist manufacturer of parenteral nutrition, which is given to babies in neonatal intensive care units.
"The products in question, which are no longer in circulation, are made to order for individual patients on a daily basis, in response to bespoke orders from hospitals.
"We are co-operating fully with the MHRA (Medicines and Healthcare products Regulatory Agency) in the investigation, and are doing everything we can to help them establish the facts in this case as quickly as possible."
All of the feeds which could be contaminated have since been recalled and regulators stressed that it was unlikely any were still in use as the batch has passed its use-by date.
Paediatric doctors said the contamination was 'every parent's worst nightmare' and that urgent action must be taken to improve the safety of processes to produce such nutrition.
Regulators said because the blood poisoning develops quickly they were not anticipating further cases, although this could not be ruled out.
Adam Finn, professor of paediatrics at the University of Bristol, said: "When a medicine makes patients sick, it is everyone's worst nightmare.
"This contamination incident seems to have been detected quickly but, tragically, not quickly enough to save a life lost. Having stopped the outbreak, the next priority will be to understand how it came to happen and ensure it cannot recur."
Public Health England (PHE) and the Medicines and Healthcare Products Regulatory Agency (MHRA) have launched an investigation.
Adam Burgess, the MHRA's manager of the Defective Medicines Reporting Centre, said: "We have sent inspectors to the manufacturer's facility to carry out a detailed and rigorous inspection and we have ensured that the potentially affected medicine is recalled."
Dr Susan Hill, a consultant paediatric gastroenterologist said: "This is a life-saving treatment for babies who are born very prematurely or with a severe gut problem. Any challenge to their immune system can be life-threatening."
A spokesman for Guy's and St Thomas's Trust said: "All babies on the unit are being screened for the bacterium as a precaution and enhanced infection control measures have been put in place to prevent any further cases. These enhanced measures will remain in place until the trust is satisfied that no other babies are at risk."